Forex trading is a genuine method to earn a decent income working from home, part time or full time. I hooked up with forex trading in 2008 and its been a roller coaster ride since then. But my initial inconsistent trading style has been ironed out over time, mostly by trial and error, the hard way, if you know what I mean. Now, although not huge, I do earn a solid monthly income in addition to other online ventures I have set up. To this date I have blown 3 live forex accounts and yet I still pursued my instincts to climb up to where I am now, because I somehow knew its possible to earn trading forex.
No, I’m not boasting. But there are many folks who think forex trading is yet another scam on the internet. And then there are some who are genuinely skeptical about how this trillion dollar market is open for the average person like you and me. In fact, once upon a time the forex market used to be a playground of only the giant banks and firms. But I personally think the culprit is the psychological barrier of us the middle class. So its time to get rid of any negative thinking associated with forex-trading.
The most important step in trading is to have proper money management rules in place. Regardless of the size of your forex account, the trading system or the strategy used, there is no progress without a solid money management plan. Yes, learning forex strategies and how to implement them is essential to trade while managing your funds, risks and leverage helps you profit from those winning strategies. Its like having a super cool car and knowing to drive it. If you don’t know how to drive, it doesn’t really matter how valuable or efficient your car is. In other words, if you ever crash in forex(like I did thrice in a row…), its you who are to blame; not the system, strategy or the broker for that matter.
Here are some posts that talk about money management in detail:
Having said that, its important that you carefully select the right broker first up, even if all you want is a forex demo account. Why? because once you open a demmo account, the chances are that you would stick with the same broker for your real forex live account. Its the human nature that we are so reluctant towards change. Following are two solid reads about how you can pick the best forex broker to meet your requirements:
Here I don’t want to make the decisions on behalf of you. Because in forex its very important that you have and know that you have 100% control over your decisions. Its you who are going to trade your money in order to make a profit for yourself. Nobody, I mean nobody will ever give you the success on a silver plate. You have to take the initiative and earn for yourself. But one thing I can do is guide you in the right direction.
Forex brokers have always been the scapegoat of those who fail. Thus its almost impossible to go with the forex broker reviews found on the internet. On a general note go with a “regulated” broker that has all your required features. Most important things to look for in a forex broker are:
- Licensed and regulated.
- Ease of registration.
- Low spread levels.
- Minimmum deposit to open account.
- Trading platform e.g. Meta Trader 4.
- Specific trading instruments e.g. Not all brokers have oil or gold as trading instruments.
- Leverage provided.
- Web trading platform e.g. If you want to be able to access your trading platform from any computer anywhere.
- Withdrawal options e.g. PayPal supported or not, country level and regional restrictions, wire transfer procedures etc.
- Ease of withdrawal.
Here’s a list to help you:
|Company Name||Broker Type||Minimum Deposit||Maximum Leverage||Spread Type||Currency Pairs||Minimum Lot Size|
|GFT||Dealing Desk||Mini: $250, Standard: $2500||400:1||Fixed||123 Pairs||10k/100k/Base 10|
|OANDA Corporation||Dealing Desk||USD $1||50:1||Variable||38 plus Gold & Silver||Flexible|
|FXCM||No Dealing Desk||Micro: $25, Standard: $2000||100:1||Fixed and Variable||39 Pairs||1k, 10k, 100k|
|CMC Markets||Dealing Desk||USD $2000||100:1||Fixed||74 pairs||minimum 10K|
|ODL Securities||Dealing Desk||USD $2000||100:1||Fixed or Variable||80 plus pairs||Flexible Lot Sizes|
|Marketiva||Dealing Desk||USD $1||100:1||Fixed||17 Pairs||Flexible|
|FXDD||Dealing Desk and Non-Dealing Desk||$250||200:1||Variable||20 pairs||minimum 1k units|
|MB Trading Futures Inc.||Non-Dealing Desk||$400||100:1||Variable||25 pairs||minimum 1 unit|
|GFX Group SA||Non-Dealing Desk||$2,000||200:1||Fixed and Variable||33 plus Gold, Silver||Minimum $10k|
|Interbank FX, LLC||Non-Dealing Desk||$250||200:1||Variable||19 pairs||1 unit|
|Saxo Bank||Dealing Desk||US $2,000||100:1||Fixed and Variable||170 pairs||minimum 1 unit|
|ACM – Advanced Currency Markets||Non-Dealing Desk||Mini: $2000||100:1||Fixed||39 pairs plus Gold and Silver||100k units|
|Forex.com||Dealing Desk||$250.00||100:1||Fixed||22 pairs||10k units minumum|
|FXcast (Antigua) Ltd.||Non-Dealing Desk||US $10||400:1||Fixed||35 pairs plus Spot Gold||1 unit minimum|
|Finotec Trading, Inc.||Dealing Desk||$200||200:1||Fixed||32 pairs||1 unit minimum|
|Dealing Desk||US $100||200:1||Fixed||50 pairs||minimum 10k units|
|IG Markets||Dealing Desk, Non-Dealing Desk||No Minimum Deposit||700:1||Variable||60 pairs||Minimum 1k units|
|CitiFX Pro||Dealing Desk||US $10K||50:1||Fixed||138 pairs||100k units|
|FXOpen Investments Inc.||Dealing Desk, ECN||$1 Micro, $25 Standard and $1000 ECN||500:1||28 pairs||1 unit|
|FxPro (FxPro Financial Services Ltd)||Dealing Desk||USD 500||500:1||Variable||over 80 pairs||minimum 10k units|
Remember, its not advisable to open a live forex account with a fresh broker straight away, even if you have some experience trading forex. And please don’t trial forex brokers and their platforms with louzy $100 accounts. Thats exactly the purpose of forex demo accounts. Do not hurry your way into live accounts unless you have at least 2-3 month hands on experience in a demo account with the same broker and you have at least $2000 to fund your live account.
Yes, you read it correct! $2000… Why? It will help you keep on top of money management. Remember money management? I will get to that in detail in another post. Now that you know the importance of using a forex demo account, assuming you already have one, what is the strategy or system you would utilize for trading?
Now we are talking business. Its not easy developing your own forex trading system, but thats exactly what you need to do if you ever want to be successful. Here are some interesting stats for you:
(from 0 to 6 months on Forex)
(from 18 months and up on Forex)
67% of the beginner traders view Forex as a Casino. They come to win.
51% of the beginner traders try their hand at scalping, since it gives them a rush of adrenaline.
90% of the beginner traders would like to open at least 10 or more trades per day.
94% of the beginner traders don’t view it as a job. To them – it’s an entertainment.
93% of the beginner traders lose their deposit within the first 3 weeks of trading.
87% of the beginner traders lose their SECOND deposit immediately following the first one.
|9% of experienced traders will admit that there is an element of gambling-like excitement.
11% of experienced traders sometimes entertain themselves with scalping, but
97% of experienced traders utilize timeframes no lower than H1.
82% of experienced traders open no less than 10 trades per month.
94% of experienced traders refer to trading as their job.
90% of experienced traders consider a month to be a profitable one if their
Stats credit : Forex 5 Stars
The stats here speak in general terms. But when you think about individual forex traders, they are all unique in their own way. Psychology and personality plays a huge roll in your trading decisions. So carefully select what time frame and currency pairs or instruments you would prefer trading. You are on your own here. But as an example, I fins myself too excited when I trade lower time frames. So I never scalp in my live account. I only trade on time frames higher than H1, mostly H4 or D1. 30min and below are too noisy for me.
But thats not to say it should be the same for you. As I said you have to understand what ‘you’ would prefer in live trading conditions. Below are some links where you can deeply understand various dimensions of both technical and fundamental forex trading whether using desktop applications such as MT4 or online forex platforms.